The entorhinal cortex funnels sensory information from the entire cortical mantle into the hippocampal formation via the perforant path. A major component of this pathway originates from the stellate cells in layer II and terminates on the dentate granule cells to activate the hippocampal trisynaptic circuit. In addition, there is also a significant, albeit less characterized, component of the perforant path that originates in entorhinal layer III pyramidal cells and terminates directly in area CA1. As a step in understanding the functional role of this monosynaptic component of the perforant path, we undertook the electrophysiological characterization of entorhinal layer III neurons in an in vitro rat brain slice preparation using intracellular recording techniques with sharp micropipettes and under current-clamp conditions. Cells were also intracellularly injected with biocytin to assess their pyramidal cell morphology. Layer III pyramidal cells did not display either the rhythmic subthreshold membrane potential oscillations nor spike-cluster discharge that characterizes the spiny stellate cells from layer II. In contrast, layer III pyramidal cells displayed a robust tendency towards spontaneous activity in the form of regular tonic discharge. Analysis of the voltage-current relations also demonstrated, in these neurons, a rather linear membrane voltage behaviour in the subthreshold range with the exception of pronounced inward rectification in the depolarizing direction. Depolarizing inward rectification was unaffected by Ca(2+)-conductance block with but was abolished by voltage-gated Na(+)-conductance block with tetrodotoxin, suggesting that a persistent Na(+)-conductance provides much of the inward current sustaining tonic discharge. In addition, in the presence of tetrodotoxin, an intermediate threshold (approximately -50 mV) Ca(2+)-dependent rebound potential was also observed which could constitute another pacemaker mechanism. A high-threshold Ca(2+)-conductance was also found to contribute to the action potential as judged by the decrease in spike duration towards the peak observed during Ca(2+)-conductance block. On the other hand, Ca(2+)-conductance block increase spike duration at the base and abolished the monophasic spike afterhyperpolarization. Analysis of the input-output relations revealed firing properties similar to those of regularly spiking neocortical cells. Current-pulse driven spike trains displayed moderate adaptation and were followed by a Ca(2+)-dependent slow afterhyperpolarization. In summary, the intrinsic electroresponsiveness of entorhinal layer III pyramidal cells suggest that these neurons may perform a rather high-fidelity transfer function of incoming neocortical sensory information directly to the CA1 hippocampal subfield. The pronounced excitability of layer III cells, due to both Na+ and Ca2+ conductances, may also be related to their tendency towards degeneration in epilepsy.